Mr. Peter takes out a mortgage of $50000 to buy a house. The mortgage will be paid over 20 years with interest paid quarterly. Given that the nominal interest rate is 15%, what is the quarterly loan payment? also calculate the remaining balance at the end of year 3.

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Cost of Credit

The cost of credit is an extra amount that the borrower has to pay besides the loan amount. These credit charges may vary from loan to loan. The cost of credit includes interest charges, maintenance charges, and arrangement charges. Some of the costs are mandatorily collected by the lender based on the loan amount and tenure of the loan. The cost of credit is also called finance charges of the credit.